Rice warns of more U.S. sanctions on Iran

PALO ALTO (Reuters) - The United States will aggressivelyimpose more sanctions on Iran as long as it refuses to give upsensitive nuclear work and uses the world's financial systemfor "terrorism," U.S. Secretary of State Condoleezza Rice saidon Thursday.

On a joint trip to California with Foreign Secretary DavidMiliband, Rice told reporters the Bush administration assessed"practically every day" whether to slap more sanctions on Iran.

"We will continue to designate entities as we find themtrying to use the international financial system for ill-gottengains and, yes, we are going to continue to do it and we willcontinue to do it aggressively," said Rice.

"Iran should not be in a position of using the bankingsystem to pass profits made from terrorism or proliferation,"she added.

Iran has been subjected to three rounds of U.N. SecurityCouncil sanctions over its nuclear program and last October,the United States designated the elite Qods military force ofIran's Revolutionary Guard a supporter of terrorism.

Washington also imposed sanctions on more than 20 Iraniancompanies, banks and individuals as well as the defenceministry, hoping to increase pressure on Tehran to stop uraniumenrichment and curb what the United States views as terroristactivities. Tehran denies the charges against it and says itsnuclear program is to produce energy.

Rice said Iran should expect more of these kinds ofsanctions but she declined to provide any timeline.

"We continue to assess it practically every day. (U.S.Treasury Secretary) Hank Paulson and I have very close contactabout that. This is not something we do as a political matter.It is something we do because the international financialsystem has got to keep its integrity," she said.

"It's important that I not get out ahead of anydesignations (new sanctions) that we might make," she added.

The five permanent members of the U.N. Security Council --the United States, France, Britain, China and Russia -- andGermany, known as the P5+1, are awaiting a green light fromIran for a meeting to present a revised package of incentives.

The offer was first made to Tehran in 2006 to try to get itto give up uranium enrichment for a range of economic anddiplomatic benefits. Iran, which is the world's fourth-largestoil producer, turned down those proposals and has so farrefused to accept the main Western demand for a suspension ofuranium enrichment, a process that can produce fuel for nuclearpower plants or atomic bombs.

Rice said if Iran rejected the revised incentives package,it faced more sanctions at the United Nations.

However, the United States would face an uphill battle fromveto-wielding Security Council members China and Russia, whichoppose further punitive measures against Iran.

Miliband said Iran should not be seen as a victim of somekind of international vendetta, adding, "It is actually theauthor of its own misdeeds."

(Editing by Frances Kerry and Jackie Frank)